Rebuilding and Competing Not Mutually Exclusive

Ever since Roy Halladay‘s injury in 2012 the Phillies have been in a downward spiral of competitiveness.  That summer they traded Shane Victorino and Hunter Pence to bolster a very poor farm system.  The Phillies finished that year with the 15th worst record in baseball and followed that up with a 7th worst record in baseball the following year.  This year they are 67-77 and Ruben Amaro is once again talking about being competitive in 2015, much like he did a year ago.  This has caused some outrage among fans who believe everything that Amaro says to be a show of his incompetence.  But are the Phillies really harming their potential future by not bottoming out?

The Myth of the Complete Rebuild:

Over the past decade not many teams have gone full rebuild.  Most, including the 2013 World Series Champion Boston Red Sox, have maintained a core of their best players to see them through.  Over this time period only 2 teams have truly bottomed out, the Houston Astros and Chicago Cubs.  The Cubs now have one of the best farm systems in baseball history, and the Astros have been arriving top talent to the major leagues all year with a solid farm system still behind them.  But at what cost?  The Astros have picked in the Top 11 of the draft the past 5 years, including 3 #1 overall picks, and look on pace to repeat that again.  The Astros last made the playoffs in 2005, and have been touted as the 2017 champ.  The Cubs on the other hand have picked in the Top 9 of the draft the past 4 seasons and haven’t made the playoffs since 2008.  Their farm system looks great, but it probably won’t be until 2016 before they are competitive for a playoff spot.  So of the two major rebuilds where ownership as brought it to the ground, teams are looking at 12 year and 9 year playoff droughts just to revitalize the franchise.  Even that comes with a lot of caveats as prospects and young players continue to develop.  It may really pay off but it is a long road to being good again.

The more successful model has been to keep the core of a team intact and take a couple of years to drop down and reload around them.  This strategy can still take years, mostly it depends on a couple of farm system breakouts and for a team to be able to shed the contracts off of its roster.

The Gap to the Top:

So how far off are the Phillies from the playoffs?  By record they are 67-77 and 8 games back of the Wild Card, their Pythagorean win % says they should be 2 games worse at 65-79.  That record is certainly scary and the gap large, but what is that gap really made of.  Lets look at a what if scenario, what if Cliff Lee had been healthy and produced in 2014 like he did in 2013.  History tells us that pitchers get hurt, but up until this year, Cliff Lee had no history of arm injury and had been performing as well as he had in his career to date.  So lets use WAR to explore the difference of David Buchanan + Cliff Lee in 2014 vs just Cliff Lee in 2013.  By Fangraphs Lee and Buchanan have combined for 2.2 WAR this year, Lee alone was worth 5.0 in 2013, so that only gives a 2.8 win jump. However, Fangraphs is more about true talent than actual on field performance, so lets look at Baseball Reference.  In 2014 Lee and Buchanan combined for 1.6 WAR, Cliff Lee in 2013 was worth 7.3 WAR, this a 5.7 win gap.  Lets apply this back to the Phillies record.  If this was just straight to their current record they would be 75-69 and 2 games out of the WC, if this is true talent expectations we are more in the 73-71 and 4 games out.  Either way Cliff Lee was a gigantic swing for the fortunes of this team.  In other words, if Amaro entered the year with the expectation that he had but a competitive team on the field if his top pitcher had stayed healthy, then he was right in his assessment.  There is another argument to be made about the impact of Domonic Brown’s regression and the effect it has had on the team’s outcome, but either way Amaro had a team that was a Wild Card contender coming into the year.

The Cost of Competition:

There are two types of cost when it comes to being competitive, the cost in resources to acquire players and the opportunity cost of not trading players.  The first cost allows us to explore the pattern of major league player acquisition that the Phillies have used for the past two seasons.  This is what it has cost to bring in players and fill holes, and so far the moves have followed these patterns:

1. Do not sign contracts past 2016 (2016 is the last full year of Ryan Howard‘s contract)
2. Do not give up draft picks for non-cornerstone players.
3. Do not trade away prospects essential to the long-term health of the Phillies.
4. Don’t block any essential prospects (this is really easy since there were none in the upper minors)

Essentially this boils down to, the Phillies have money, plenty of money, if assets just cost money during the 2013-2016 seasons than the loss if they don’t pan out is just profits that would have gone into the owners pockets.  This strategy has had ups and downs, Mike Adams was misguided, and Marlon Byrd looks like a bargain.  But the worst case scenario is that you spent money.  The trades they did make have involved players that look like relievers, or fringe starters, and the best player they traded (Vance Worley) was released and appears to be putting up unsustainable #4 starter numbers.

Then we move to opportunity cost, or is the trade return good enough to dissuade me from trying to compete.  Lets start with the big piece here first Cole Hamels, if you trade Hamels you render the rest of the discussion useless because you aren’t competing for at minimum the next two years without him (unless you are willing to go all in on big money and long running ugly contracts).  If you are trading Cole Hamels, you need to be getting back a massive collection of talent (which may actually be concentrated in a few individuals), and it really does not seem like the market is willing to pay that price.

Now we get to the old core of the Phillies in Chase Utley, Jimmy Rollins, Carlos Ruiz, and Jonathan Papelbon.  All four have been worth more than 3 wins each so far this year according to Baseball Reference.  In the trade talks that have become public it appears that this group either has a no-trade clause or has little to no trade value.  Lets take Papelbon for example, if you are the Phillies, he is actually providing the team positive value in 2014 (3 bWAR), and has a track record of success.  Therefore if you are trading Papelbon you want something of value in return, whether it is money or prospects, moving him for nothing is giving up 3 wins of value to hedge against a 2015 collapse, and for the Phillies, it is again, just money, they can absorb financial hits.  This has put the Phillies in a tough situation, the market is not paying for aging players, even if they are returning value on their contracts.  The exception has been Byrd where the market appeared to not be looking for an established player and paying established prices for it.  The pieces Seattle and Yankees moved for Denorfia and Prado were not of the caliber that would have made for a good return for Byrd.

The Farm System:

There has been much said by fans and beat writers this year that implies that the Phillies farm system is bad and that the only way to recharge the farm system is to trade.  This has led to very skewed view points both on what is a good farm system and what the impact of available players in trade are.  Phillies fans don’t need to be told that top prospects (Domonic Brown) are far from sure things in the majors.  This drops off quickly as you go down top prospect lists and has I have previously written, the value of prospects is non-linear and the value of a top prospect (J.P. Crawford) is much more than lower level prospects.  The way to combat this is to acquire a volume of prospects, but as we talked about above, you need to remember that you are trading known quantities for unknown prospects.  Outside of trades there are other ways for teams to acquire talent that are unaffected by the attempts the compete at the major league level.

Over the past few years the Phillies have expanded their horizons on talent acquisition to take advantage of the resources afforded to them by their standing and financial resources.  The Phillies have drafted somewhere between solid and very good over the past 4 drafts (2011-2014).  They have expanded their presence in Latin America at both the top and bottom of the market.  The results have been tangible, the farm system was one of the worst in the league after the 2012 season, right now it is in the top half in baseball and is loaded with talent that has continued room for growth.  The Phillies have also begun to graduate talent to the major leagues as well with Maikel Franco, Ken Giles, David Buchanan, and Cody Asche all making their debuts over the past few years, with players like Jesse Biddle, Aaron Nola, and Kelly Dugan poised to arrive in the next season.  Additionally the Phillies have looked to leverage their resources in the Cuban market, so far they have only been able to land Miguel Alfredo Gonzalez (who has looked good, but has medical concerns that have left his ceiling in doubt).  They will likely continue to be in on international major leaguers if the contracts are not prohibitive to future growth.

Overall, the Phillies have been able to make great strides to build a farm system quietly behind the scenes, by using a strategy of being competitive that has not cost valuable resources from the farm system.  They have been able to augment with trade when those trade are available, and the returns have been good the last few years.

What Does This Mean For the Phillies Going Forward?

Despite all the idiotic things Amaro says, he has actually been a pretty good GM for the past two seasons putting the team in a position to compete if given the right breaks, without jeopardizing future growth.  Despite the dumb moves he has made during previous years.  This doesn’t necessarily make him the ideal GM of the future, nor does it mean that he has made the right moves for the right reasons.  However, the idea from the Phillies FO that this team can still be competitive for the playoffs, especially the Wild Card, is not that farfetched and it does not hurt the Phillies ability to rebuild to a division contender in a timely manner.